In an era where millions of Americans face limited access to high-quality healthcare, artificial intelligence (AI) holds tremendous potential. It enables remote diagnostics, boosts efficiency in public health interventions, and aids clinical decision-making in low-resource settings. However, the private sector's innovation might be widening existing disparities by training on homogeneous datasets and benefiting high socioeconomic status populations.

Unleashing AI's Potential for Medicaid Recipients

Addressing the Disparity Gap

In 2022, the US spent a whopping $4.5 trillion on healthcare, accounting for 17.3% of total GDP. Despite the high spending, outcomes are worse, with lower life expectancy and higher death rates. The 80 million low-income Americans on Medicaid have the least access to healthcare and often face below-average health outcomes. AI has the power to transform healthcare, but private-sector-driven innovation exacerbates inequities. For example, until January 2023, the kidney transplant prioritization model ranked Black patients lower. AI models are more complex and difficult to understand, increasing the likelihood of biases. Startups also focus on more lucrative markets, leaving marginalized populations behind. The Federal Government can bridge this gap. The Center for Medicare and Medicaid Innovation (CMMI) should launch the AI for Medicaid (AIM) Initiative to incentivize and pilot novel AI tools for Medicaid recipients.

The AIM Initiative - A Path Forward

Guided by the former Medicaid Innovation Accelerator Program and relevant executive orders, the AIM Initiative will encourage private-sector partnerships with state Medicaid programs. It aims to lower costs and improve care delivery for rural and low-income populations. Precedents in other countries show early success. In 2023, the UK's NHS partnered with Deep Medical to pilot AI software, saving over $30M annually.

Plan of Action

CMMI will launch and operate the AIM Initiative within the Department of Health and Human Services. $20M from the annual budget will be allocated. State Medicaid programs will submit proposals for competitive grants, with technical assistance provided. Selected projects will be monitored and evaluated.

Sample Detailed Timeline

0-6 months: HHS Secretary announces and launches the AIM Initiative, includes funding in the budget request.6-12 months: CMMI engages with state Medicaid agencies and selects proposals for pilot funding.Year 2-7: Launch and roll out selected AI projects with continued technical assistance.Year 8: Produce an evaluative report and recommend broader adoption.

Risks and Limitations

Participation: Success depends on state and private-sector participation. CMMI will engage with the National Association of Medicaid Directors and startups. Oversight: Guardrails are crucial to protect patients. State Medicaid agencies must submit evaluation plans, and technology partners must meet certain standards. Longevity: As a pilot program, it only facilitates short-term projects. HHS leadership must ensure program evaluation and long-term integration.Conclusion: The AIM Initiative is a significant step in bringing AI's promise to all Americans. It engages stakeholders and positions the US as a leader in healthcare AI. Addressing market failures in digital health can unlock efficiencies and bridge the health equity gap. This policy memo is part of Day One 2025, aiming to tackle challenges and create a better future.